You are currently browsing the daily archive for July 17, 2013.

Too Many MBA’s in the World?

By Shlomo Maital

          MBA Dilbert

Yesterday’s (Monday July 19 2013)  Financial Times, p. 8, has a report on business schools (Emma Boyde, “A degree of relevance for the 21st C.?”   p. 8).  

   According to FT,    there are 15,673 institutions worldwide offering business degrees at all levels.   “Are many students wasting their money on an irrelevant qualification?”  asks the article.  As someone who teaches MBA students, I am deeply disturbed by this issue. 

   The MBA degree accounts for 2/3 of all graduate business degrees in the US.   Basically, America invented the MBA.  In 2011-12,  some 156,400 students were enrolled in US MBA programs.  Outside the U.S., 110,002 students were enrolled in MBA programs.

   That means that worldwide,  there were a over  a quarter of a million MBA students worldwide.  Assuming the vast majority of MBA programs are now 12 months in duration,  this suggestions that over a decade,  there will be 2.5 million new holders of MBA degrees, added to the millions of existing MBA’s.

    The article asks,  “The world has moved on, the question is have business schools moved on and the answer is, not yet!”.

    The fundamental problem?  In an age when new creative innovative thinking is needed on the part of managers, bizschools all teach more or less the same material, the same tools, the same approach to management.  

   What then is the value of an MBA degree, if the holder has no unique differentiator?  Why study strategy, about creating unique value, if the MBA graduate or his or her expensive degree brings no unique value? 

    Why do we MBA professors teach our students that “this is the right way to manage, the way everyone manages,  read these case studies”,  when we should be teaching them, “here is how everybody manages, now, you can YOU do it better, differently, more creatively?  How can you BREAK the rules, after you learn what they are?”

      

Advertisements

More Fatal Flaws of Capitalism….

By Shlomo Maital

                capitalism

…and, while we’re at it…a few more fatal flaws of capitalism.  (from TIME, July 8/July 15,  2013). 

    *  A third of Americans say they want to earn a lot more money…yet studies show, being free of debt is a far more powerful contributor to happiness.  Capitalism is based on consumer spending financed by debt.  The more you own, the more you owe….

   * One American worker in 10 commutes an hour or longer a day.  Commuting is among the activities Americans hate most.  Yet many continue to do it.  Why? To earn the money to buy stuff they don’t need, that doesn’t bring happiness, so they can continue to squeeze onto stuffed commuter trains.  Makes sense.

 *  One American in 10 takes antidepressants.  Many don’t work.  Many have bad side-effects. Drug companies profit hugely.

  *  People are happier when they spend on life experiences, like travel,  yet the capitalist system is based on buying the latest and greatest ‘stuff’.

 

     The happiness capitalism promises, based on filling our closets and homes with more and more ‘stuff’ we really don’t need or even want,  is nonexistent. 

     One of these days, the people are going to realize it. 

    What happens then?   Don’t ask the economists.  They are still promoting capitalism.

 

Capitalism’s Fatal Flaw: Wealth Makes Us Selfish (and Unhappy)

By Shlomo Maital

             Piff

  I’ve always suspected it.  Now I know.  Capitalism’s fatal flaw is that wealth makes us nastier, more selfish, less ethical and less happy.  (Thanks to Facebook Friend Vic Nurcombe’s post, directing me to this material.)

   In his 2012 article published in the prestigious Proceedings of the National Academy of Sciences *,  Berkeley Scholar Paul Piff (and associates) find the following, based on extensive experimental research:

   “Seven studies using experimental and naturalistic methods reveal that upper-class individuals behave more unethically than lower-class individuals. In studies 1 and 2, upper-class individuals were more likely to break the law while driving, relative to lower-class individuals. In follow-up laboratory studies, upper-class individuals were more likely to exhibit unethical decision-making tendencies (study 3), take valued goods from others (study 4), lie in a negotiation (study 5), cheat to increase their chances of winning a prize (study 6), and endorse unethical behavior at work (study 7) than were lower-class individuals. Mediator and moderator data demonstrated that upper-class individuals’ unethical tendencies are accounted for, in part, by their more favorable attitudes toward greed.

   Piff even found that wealth causes people to literally take candy from a baby (from a dish on a table, said by the experimenter to be for “children in a later experiment”).   Those who drive a BMW are far less likely to stop for pedestrians at a cross-walk than those who drive a Kia. 

    And the key cause of all this?   Something known for many years, from behavioral economics.   The causality fallacy.   Human beings need to understand the world and how it works. So  THEY ATTRIBUTE CAUSALITY TO THINGS THAT ARE INHERENTLY RANDOM.   A great deal of wealth is due to luck.  Was Facebook founder Mark Zuckerburg super-brilliant (he was),  super-astute, super-creative, or did he have a great deal of luck in the viral manner in which Facebook spread, from a local Harvard class project to a global world-changing phenomenon?    People who are wealthy attribute their wealth to their own brains, creativity, energy, innovativeness (even though a huge portion of wealth is simply inherited);  so naturally, they attribute the plight of poor people to the inadequacies of the poor (they are dumb, lazy, stupid, lack hard work, and in general are worthless).  Even in Monopoly game situations, this effect occurs.  Those given favored wealthy positions in Monopoly behave AS IF they were wealthy in real life.  Those given disadvantaged positions in Monopoly behave far more generously and altruistically.

    Everyone knows that poor people tend to help one another a whole lot more than do wealthy people.  Now we begin to understand why.   

   And the ultimate irony?  As Piff notes,  those who are generous and altruistic are happier and live longer.   So all that “greed is good” stuff makes society more fractious, less cohesive, and makes the wealthy less happy. 

   This is the fatal flaw in capitalism.  Either wealthy people need to change their DNA, or we need to find a much better ‘hybrid’ system.     I urge you, dear readers, to download and read the original article in full.

 ——————-

* Paul K. Piff, Daniel M. Stancatoa, Stéphane Côté, Rodolfo Mendoza-Dentona, and Dacher Keltner. “Higher social class predicts increased unethical behavior”.   March 13, 2012.

Blog entries written by Prof. Shlomo Maital

Shlomo Maital
July 2013
M T W T F S S
« Jun   Aug »
1234567
891011121314
15161718192021
22232425262728
293031  

Pages

Archives

Advertisements